Business Center
Center for Business
& Estate Planning
Estate Planning
Fundamentals
Getting Started
Your first step in developing an estate plan should be to assemble a competent, professional estate planning team. For some, this initial step is a difficult one, because it requires you to share your personal thoughts, fears, wishes, and financial affairs with others. Therefore, it is often comforting to incorporate at least one trusted advisor, regardless of his or her area of expertise, in the estate planning process. Certainly, your attorney will play an instrumental role in preparing any necessary legal documents. However, your financial professional, bank trust officer, insurance agent, or accountant may also need to become involved. Generally, the size and complexity of your estate, as well as the existence of an established relationship with an advisor, will dictate the overall involvement and/or need for additional professional expertise or emotional support.
Initially, your estate planning team will focus on your current financial position. This is a very important part of the estate planning process, because you need to know where you stand today in order to accurately plan for the future. For this reason, you will need to gather any and all materials involving current or future income, property ownership, insurance, and legal arrangements already in place. This may require you to divulge private information, but it is a necessary part of the estate planning process. Here is some of the information you'll need to provide:
- Current income from employment and all investments.
- Investment documents, certificates, statements, passbooks, etc.
- All retirement benefits: Social Security (including survivors' benefits), Individual Retirement Accounts (IRAs), pension and profit sharing plans.
- Any expected deferred compensation.
- Deeds to primary and vacation residences.
- Life insurance policies of which you are the owner, the insured, or the beneficiary.
- A list of all personal property.
- Current and expected debts and obligations, including mortgage and loan balances, real estate liens, taxes payable, consumer debts, and estimates of funeral costs and estate settlement expenses.
- Your will, if you have one.
- Trust agreements, if any.
A complete analysis can begin once you've assembled this information. This will allow you to take a closer look at your family's needs. Some important questions that you will find answers to are:
- How will your family's overall cost of living requirements change in the years ahead?
- Who will take care of any minor children if something happens to you?
- Who will make medical and financial decisions on your behalf if you become incapacitated due to illness or injury?
- What are the estimated educational expenses when your children reach college age?
- Is there a family member who needs special care or medical attention?
- How will estate taxes affect your assets as they are currently held?